Outsource Magazine Issue 28 - (Page 94)

outsource xPLores The FuTure oF righTshoring in associaTion wiTh B Philip Taylor is a Professor at the University of Strathclyde, Scotland, and the author of numerous works on call centres, offshoring and business process outsourcing. To launch our Xplores series with Scottish Development International examining ‘The Future of Rightshoring’, we spoke with Professor Taylor about the trend towards rightshoring, the drivers behind location decisions, and what lies ahead in the way of challenges and opportunities… where we identified business platforms as having four key characteristics: business platforms deliver standardised offshore English-speaking voice services business processes; to India or the Philippines, but might at the business platform owners (service same time seek to utilise Eastern Europe providers, not buyers) manage the for IT solutions or perhaps Latin America business processes associated with for a Spanish-speaking voice capability. the business emerged have been multiSo what haveplatform and furnish the complete strategies as the scale and locational solution, including the people that operate them, the underlying software complexity of offshoring and outsourcing platform and have grown. the infrastructure; business platforms focus on business Now within this global service delivery, outputs or outcomes such as improved the question of the most appropriate working capital and higher customer location for a particular type of service has loyalty, which might be termed rightshoring. arisen, not inputs such as labour and physical assets; This formulation is essentially concerned business platforms service Cost than with a mix of quality and cost. more is one client. obviously a very important factor driving Well-executed business platforms offshoring, the relocation of business provide customers with compelling services, but is by no means the only technology-enabled business process one. The questions of labour capability, services that help quality, infrastructure, labour skill, labourdrive innovation via process re-engineering, greater business supportive government policy, political agility, and productivity improvements. stability and so on are factors that They are flexible probably qualify skill, so complement and and scalable in the face of within this decision-making scenario it’sglobal demand fluctuations and provide high-quality process workflows. that organisations are trying to adjust the appropriate mix of ’shore’ locations. There are three important strands. First of all, there is remote offshoring. India and the Philippines remain easily the most important destinations for business process outsourcing (BPO). In fact, there are now more call centre operators in the Philippines than there are in India servicing the international market. ITrelated services and the different types of non-customer-facing BPO activity are still resourced to the greatest extent from India. But the multiplicity of offshore destinations has also grown. Despite South Africa’s earlier promise, it has not grown to the extent that was anticipated. The Middle East – and for a period Egypt – grew significantly as well. There are a host of destinations servicing the Englishspeaking world, but none of them have the scalability or the importance in terms of value that India or the Philippines have. The second strand is nearshoring which involves the relocation of a service or a process to a geography adjacent to the home geography. The classic example might be here Canada to the United States, where historically labour costs might be cheaper but they share a similar time, culture and so on. To an extent nearshoring has been chosen because it has less risk The FuTure oF righTshoring usiness platforms, enabled by the fusion of cloud computing, SaaS Professor Taylor, in an outsource:and BPO innovationscan integrated singular managed we begin with your idea of what you considerservice, arecurrent state of as to be the emerging rapidly the desired “one-to-many” utility service rightshoring? for providers The new source for what Philip Taylor:and astarting pointof value for outsourcing buyers. Business platform might be termed as rightshoring is to grasp outsourcing position in global service a company’sofferings combine business process or global sourcing. Remote delivery, outsourcing with enabling technologies and services, and the locations – offshoring to developingworld’s largest providers are beginning tended to countries (which classically has to dust off existing offerings and invest aggressively be – at least in terms of publicity focus – to lead call centres or the back office from around in niche markets. To better understand the evolution tended services the UK or the US to India)of these to be and the state a the market, HfS polled conceived of ofone-to-one relationship. So 21 service in developed countries, the companiesproviders and evaluated 112 UK business platforms as part of its Business and US, send call centre services to India Platform Map™ market survey during and the centres there serve customers in Q4 2011. Over three months we one-to-one these geographies. This kind of briefed providers on their strategy and offerings. relationship seemed to fit the early years of This report outlines or offshoring. remote outsourcing some highlights of our results. has happened over the last halfWhat decade or so has been a change in which buyer companies if they are What are business larger, or suppliers if they’ve platforms? got greater capability, have tended to locate different the HfS Research first documentedfacilities and different services in different in emergence of this set of offerings locations. The suite of document titled ‘What Are our researchglobal locations has grown. Now it could be that an Why Do They Business Platforms and organisation might Represent the Future of Outsourcing?’, x x 94 ● ●●●● For more great content on ‘The Future of Rightshoring’ see the series index at www.outsourcemagazine.co.uk/sdi www.outsourcemagazine.co.uk http://www.sdi.co.uk/sectors/bpo.aspx http://www.outsourcemagazine.co.uk/outsourcexplores http://www.outsourcemagazine.co.uk/sdi http://www.outsourcemagazine.co.uk

Table of Contents for the Digital Edition of Outsource Magazine Issue 28

Deep Thought
John Seddon
At Your Service?
Plenty To Chew On
The Power of Two
Big Data
Invested Outsourcing
Tim Cummins
NOA Round-Up
Managing Knowledge in a Partnership
A Long Way Still To Go
Recruitment Process Technology
Let’s Talk About Our Relationships
Great Expectations
Transformative Technology
The Future of Rightshoring
Top Ten
The Legal View
HfS Round-Up
Online Round-Up
Inside Source
The Last Word

Outsource Magazine Issue 28